Nexenta scores another $21m

Will use to grow until ... IPO?

Privately held startup and ZFS zealot Nexenta has snagged $21m in a C funding round and, as the self-proclaimed fastest-growing growing company in enterprise storage, is ready to power on to IPO-land and Croesus-level riches for its backers – or so they wish.

The company supplies NexentaStor, an Open Solaris and ZFS-based storage O/S, and says it has experienced three years of growth exceeding 400 per cent year-over-year, which must make certain storage suppliers pig-sick. Among the bragging statistics Nexenta has given out is its boast that in 2011 it drove $300m in hardware sales through the channel, supplied more than 4,000 customers, and has tripled its workforce.

Nexenta was started up in 2005 with half a million dollars of seed funding followed by a $6m funding A-round. It received an undisclosed amount of B-round funding in 2010 from Translink, a US-based venture capital fund with close relationships with a number of Nexenta customers, including co-investor Korea Telecom, as well as additional investment from existing investors Javelin and WTI. We're guessing it was between $10m and $20m

The $21m comes from Menlo Ventures, the lead investor. Sierra Ventures and Razor’s Edge Ventures also participated, joining the now current investors Javelin Venture Partners and TransLink Capital. This takes total funding to an estimated $37.5m to $47.5m, which "will be used to sustain the company’s growth, pace of innovation, and global expansion to meet the rapid demand for the company’s solutions".

An annual growth of 400 per cent plus must make its backers exceptionally happy and an IPO looks like a possible 2014 event, given two more years of similar growth from an expanded infrastructure.

Nexenta CEO Evan Powell was in typical pugnacious mode in the canned statement about the round: "Most new storage start-ups simply perpetuate the same old ‘lock ‘em in’ business model, with a snazzier name plate on the array and unproven software under the hood. This investment will enable us to make enterprise-class storage for everyone a reality for tens of thousands more partners and end users around the world ... I couldn’t be happier to be partnering with Menlo Ventures and Sierra Ventures as we seek to open up one of the last bastions of antediluvian, lock-in based, business models in enterprise IT.”

Good old Evan, he tells it like he thinks it is, and then some. It's a colourful storage world in his neck of the woods. ®